the nature of economic growth in india in described as jobless growth. do you agree with this view? give arguments in favour of your answer.
Answers
ANSWER:-
In a jobless growth economy, unemployment remains stubbornly high even as the economy grows. This tends to happen when a relatively large number of people have lost their jobs, and the ensuing recovery is insufficient to absorb the unemployed, under-employed, and those first entering the workforce. According to Census 2011, the average growth rate of the economy was 7.7 per cent per annum, when it was only 1.8 per cent for employment.
Reasons behind the Jobless growth
In India, growth is attributed to service sector, whereby both employment and wages have seen a rise. The biggest employing sector in India is the Agriculture sector, employing 45% of the population but contributing 15% to the GDP, whereas Service sector is the biggest contributor to the GDP but employs less than 30%. IT and Financial services are drivers of service sector growth in last 2 decades however both of these sector are not employment intensive. Thus contributing to jobless growth in India.
Labour –intensive manufacturing sector did not become the engine of growth in India.
Stagnation in manufacturing output and employment and contraction of labour-intensive segment of the formal manufacturing sector due to
(a) Excess rigidity in the formal manufacturing labour market and rigid labour regulationshas created disincentives for employers to create jobs
(b) Industrial Disputes Act has lowered employment in organized manufacturing by about 25% – according to World Bank.
(c) Stringent employment protection legislation has pushed employers towards more capital intensive modes of production, than warranted by existing costs of labour relative to capital
To reverse the Phenomenon of Jobless growth followings reforms needs to be done:
The need of the hour is to make livelihood creation central to development strategies rather than just projecting it as natural fallout of growth.
Labour Laws should be reformed as due to the stringent Labour Laws Corporates in India are preferring Capital intensive mode of Production in a country where labour is abundant .
Encouraging people’s entrepreneurial instincts .
The education system needs to be revamped to create the desired skill-sets.
Job Intensive sector like Food Processing Should be promoted.
MUDRA scheme should be expanded as it can be a game changer for MSME sector and this sector has a potential to create required jobs in India.
Steps Taken by Government
Integrated Rural Development Programme (IRDP)was launched in 1980 to create full employment opportunities in rural areas.
Training of Rural Youth for Self-Employment (TRYSEM):This scheme was started in 1979 with objective to help unemployed rural youth between the age of 18 and 35 years to acquire skills for self-employment.
RSETI/RUDSETI:With the aim of mitigating the unemployment problem among the youth.
By merging the two erstwhile wage employment programme – National Rural Employment programme (NREP) and Rural Landless Employment Guarantee Programme (RLEGP) the Jawahar Rozgar Yojana (JRY)was started with effect from April, 1, 1989 on 80:20 cost sharing basis between the centre and the States.
Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA).
Pradhan Mantri Kaushal Vikas Yojana (PMKVY),.
Start Up India Scheme.
Stand Up India Scheme.
There is a need for National Employment Policy (NEP) that would encompass a set of multidimensional interventions covering a whole range of social and economic issues affecting many policy spheres and not just the areas of labour and employment. The policy would be a critical tool to contribute significantly to achieve the goals of the 2030 Agenda for Sustainable Development.